Linking your database to the Internet Arthur Middleton Hughes Vice President / Solutions Architect KnowledgeBase Marketing, Inc. National Center for Database Marketing Fairmont Hotel San Francisco Monday July 12, :30 – 11:15 AM

What KnowledgeBase Does

Agenda Introduction: How the Web has changed Database Marketing The Value of a Name Case Studies Using the web to build customer loyalty Using the web for customer service Premier Pages

Database Marketing Pre 2000 Your database was built on a server or a mainframe. You got hard copy reports. You accessed the database by special software on a terminal. You had to be connected to the server or a main frame.

Marketing Database Data Access And Analysis Software Customer Transactions Marketing Staff Inputs from Retail, Phone, Web A modern database Appended Data

With the web it is much easier You have no need for a leased line. You need no software on your PC other than a browser and Excel You access your database through the web.

Marketers Access The Database Through The Internet Marketing Database

Data Entry Pre 2000 Customers called an agent on the phone Or sent data in by fax or mail Data was entered into the database by someone at a keyboard Data was updated periodically. Even when it was fast, it was slow.

How data enters your database today Customers and telephone agents enter data directly to a micro web site. The site is on the server where your database resides. Customers do most of the work. The data is updated all day. It isn’t just fast, it is instant.

Customers Update Their Preference Profiles Welcome back, Susan. Can you look over your profile and bring it up to date? Thanks… Database Pre-Populated profile thank you says to click here

Customer communications pre 2000 The theory was 1:1 marketing, but… You made phone calls or wrote letters. Phone calls cost $3 - $7 each Letters cost $1.00 each. Communications were rare and expensive.

Customer communications today Inbound, customers come to the web, and get instant information, and web responses or s. Outbound, you can communicate with a million customers a day for almost nothing. 1:1 marketing can be a reality, if you have the right software and marketing strategy.

Production Marketers use Campaign Management Tool to select households for blasts Database Blaster Selected records are sent to blaster. Promotion history with codes stored in database. PC Reports Campaign Management Tool

Tracking Performance To get tickets, Click here Response Micro- Site captures Response and Campaign code Database Reports on Return on Investment s to customers & prospects Reports through web compare outgoing s and program response

Reports Pre 2000 All databases produced hard copy reports. Many permitted marketers to use SQL or other software to do ad hoc queries Marketers did not know how to use SQL Most marketers were frustrated with their ability to get data

Reports Today Marketers access their database through the web. There are standard reports that they can run and print on their PC printers There is English Language Ad Hoc software that they can access through the web, and print on their PC printers.

Report Creation Database Report Catalog Programmers create the reports needed by the staff, and list a report catalog on the web site Programmer

Report Production Database Web Report Catalog Marketers choose reports via PC on web Reports printed on PC Printer

Campaigns Management Pre 2000 Marketers wrote memos to programmers who selected the names. Programmers prepared tapes that they sent to vendors. They sent hard copy reports to the marketers.

Campaign Management Today Marketers use ad hoc web software to select names from the database. Selected names can be downloaded to the marketer through the web. Or the selected names can be downloaded to a vendor. Marketers create their campaigns.

How Marketers Develop Marketing Campaigns Campaign Manager Software Blasting Software Reports Through Web Access through Web Customer Database

Database Update Pre 2000 Input was entered on a PC and updated in batch from a diskette or tape. Many tapes arrived at once and were converted to a common format. For a big file, the process took a couple of weeks.

Database Update Today Customers enter their own data directly through the web Other inputs arrive through the web and are converted through stored procedures. Relational database updates changed records only. The process is automatic and fast.

Security: Access to web databases controlled by DBA Database Administrator assigns IDs and passwords to all users and controls which data reports each user can view.

The value of a name

How names are used Regular promotions Low cost items Last Minute Specials Retention Messages Follow Up Messages Viral Marketing Newsletters Name Rental

Regular Promotions

Low Cost Item Promotion

Last Minute Special

Retention Messages Birthday Cards Thank You Customer Surveys Service Reminders Monthly Summaries

Retention Messages

Follow up messages Thank you for your order Your order was shipped Did your order arrive on time and OK?

Susan: If you want to have some friends come to Hawaii with you, list them here and if they decide to go, we will give each of you a 10% discount on your trips. Dudley Foulke Helena Errazuris Arthur Hughes Dear Helena: Rick and I are going to Hawaii on August 7 th. We thought it would be great if you could come with Us. We are staying at the Maui Surfside which is a great deal. To find out about it Click here! Hope you can Join us! Susan Database Viral results in more s and data capture Viral Marketing

Send Name

Newsletters

Name Rental

Total Annual Name Value

A few case studies Isuzu, Hewlett Packard, Universal Music, Web Focus Groups, Marketing, Getting customers to join a club.

Isuzu Post Card Direct To sell their trucks, Isuzu developed 24 different postcards, each with a different case study of truck use such as Gardening, Plumbing, Moving. They set up a web site and used direct mail to get dealers to come to the site and order post cards for prospects developed by Isuzu.

Dealer Direct Application

HP On Line Survey Competitive Advantage Through Advanced Technology  Hewlett Packard tested an on line survey to promote their network printers.  Direct mail drove responders to a web site that contained the survey. Responders received $10 in Pizza Hut coupons.  The survey provided a special HP offer for network printing solutions, product links, and e-subscription information.

Universal Music eMarketing Campaign  UMG tested an e-marketing strategy to increase record sales of a new album release for Lucinda Williams  The campaign delivered more than a 960% increase to the Lucinda Williams fan base  Reached nearly 200,000 fans and prospects with communications  Won DMA Gold Echo Award in 2002

Web Focus Groups

What Works: Marketing

Where else can you get these results in 3 days?

Get customers to join a club A company sold sporting goods created a member club. When DB was built they learned that: Club members bought 11 times more than non club members. In two years, 81% of club members became multi-buyers.

Club members conversion

Cataloger Example Miles Kimball sent 20,000 s with three different catalogs, and 20,000 with the three catalogs alone. Those who got the s bought 18% more than those who got the catalogs alone.

Retailer Example Video retailer sent newsletters to 170,000 customers for 6 months. Control group of 14,000 got no s Retail sales to test group was 28% more than to those without s.

New idea: Digital Neighborhoods You can get customers online behavior appended to your database.

17 Digital Segments

The web is the greatest direct marketing vehicle ever invented

How the Web is changing Database Marketing Recognition Reaching out Customer service Supplier Relationships Information Ordering parts and replacements Building personal relationships

Communicating Screen: Thank you for your order Your order has been received Your order will be shipped Your order was shipped Was everything to your satisfaction? Cost of all of the above? Nothing!!!

Now, this is recognition! Welcome Back, Arthur!

Immediate Feedback!

30 seconds later:

The big Web winner: Customer Service Hundreds of millions of dollars being saved today through use of the web Much bigger than consumer sales

How the Web is changing Customer Service 1980s: toll free numbers Thousands of agents reading screens Heavy cost: phone call and agents 2003: let the customers get their own information No cost for phone or for agents Customers like it better!

Letting them go behind the counter Open your entire company to your customers Let them find what they want themselves It is cheaper for you, and customers like it better.

How Amazon saves millions

How Fedex Saves Millions

Case Study: Shift Customer Calls to the Web

Current Situation Company receives 7.5 million phone calls per year at 500 person call center Cost per call is $6.50 or $48 million per year. Web transactions cost $0.10 6% of transactions now go through the web site. Proposal: improve the web site so more calls can go there.

Method: Personalization For the web to replace a live operator, it must be as good as a live operator. Personalization, and intelligent response to the customer’s input. Time required to improve web site: 14 months. Cost of web improvement: $1.8 million

Dollar savings through increased web use

How the savings can be achieved Make the web experience so rewarding that customers will prefer it to a phone Call. Make users empowered by functions available to them. As soon as the enhanced web functionality is up and running, run programs to drive customers to the web sites

How to measure web success Get a base line for existing transactions Determine the cost of each transaction After transactions begin to shift to the web, determine how many have shifted Measure your savings.

Why customers like to use the web

Why customers like it: My vacuum cleaner problem We have a Hoover with a MicroFiltration Bag. We wasted an afternoon going to six (yes six) stores looking for new bags. No luck. So we tried the internet.

Finding Hoover on the Web

Ordering a Micro-Filtration Bag for my Hoover

Letting customers come behind the counter A Marriott Example

Let’s try it. Let Marriott plan a meeting in Ft. Lauderdale

We want 3 rooms with 50 attendees, golf and pool

Here are the properties. Let’s try the North Marriott

Here are the conference rooms we need

Here is the hotel

And, here is the location. Let’s make a reservation!

The Marriott Web Site: 1,800 Hotels $10 billion revenue Marriott doesn’t own most of the hotels Internet team began in 1997 More interactive, the more business Meeting planners don’t need to visit the sites. All they want is on the web. Booking a room for a business traveler is very fast

Dell Premier Pages

Dell Premier Pages…

Benefits of Premier Pages

Dell Premier Pages 70% business, 30% consumer on web Premier pages: one page per company Builds brand loyalty Reduces phone calls Takes only 30 minutes to create a new Premier Page for a new customer.

Premier Page History Reports

Dell sales follow up IS director checked networking equipment on Dell site. Did not buy. Next week got Dell salesman call to help with networking purchases Customers like it.

Office Depot Premier Pages Office Depot Online discovered: on line customers spend 33% more than catalog customers Using a premier page system, Office Depot Online provided 85% of Bank of America’s office supplies

Bring back the old corner grocer:

Conclusion: You can do this! Invite your best customers into your company. Let them rummage through your warehouse. Let them look up technical data themselves Make them a part of your company. You will have them for life.

Books by Arthur Hughes From McGraw Hill. Order at Contact Arthur: